A report released by the Institute for Supply Management on Tuesday showed U.S. manufacturing activity continued to contract in the month of September.
The ISM said its purchasing managers index dropped to 47.8 in September from 49.1 in August, with a reading below 50 indicating a contraction in manufacturing activity. Economists had expected the index to inch up to 50.1.
With the unexpected decrease, the index fell to its lowest level since hitting 46.3 in June of 2009, the last month of the Great Recession.
Timothy Fiore, Chair of the ISM Manufacturing Business Survey Committee, noted the contraction continues six straight months of softening in manufacturing.
“Global trade remains the most significant issue, as demonstrated by the contraction in new export orders that began in July 2019,” Fiore said. “Overall, sentiment this month remains cautious regarding near-term growth.”
The new export orders index slid to 41.0 in September from 43.3 in August, falling to its lowest level since hitting 39.4 in March of 2009.
The contraction in new export orders negatively impacted the new orders index, which crept up to 47.3 in September from 47.2 in August but still indicated a contraction.
The ISM also said the production index fell to 47.3 in September from 49.5 in August, while the employment index dipped to 46.3 from 47.4.
Meanwhile, the report said the prices index climbed to 49.7 in September from 46.0 in August, indicating prices decreased at a slower rate.
The ISM is scheduled to release a separate report on service sector activity on Thursday. The non-manufacturing index is expected to slip to 55.0 in September from 56.4 in August.
The material has been provided by InstaForex Company – www.instaforex.com